Panasonic-Minda Industries deal gets Competition Comm approval

Fair trade watchdog CCI has approved the proposed joint venture between Minda Industries and Japanese group Panasonic, saying the deal would not have any adverse impact on competition in India.
Under the multi-layered deal, Minda Industries would enter into a joint venture with Panasonic for manufacture and sale of lead acid storage batteries (LASB) for automotive and industrial applications.
Panasonic would have 60 per cent stake while the rest would be held by Minda Industries in the entity, which would be housed in Minda Batteries Pvt Ltd.
Post-deal, Minda Batteries would be renamed as Panasonic Minda Storage Batteries India Pvt Ltd.

Minda Batteries is currently owned by a promoter of Minda Industries.
Giving its nod, the Commission said the proposed combination is not likely to have appreciable adverse effect on competition in India.

Apart from not having any vertical relationship between them, Competition Commission of India (CCI) said Minda Industries and Panasonic have only small presence in their respective LASB segments in India.
"... There are other significant players present in the LASB market, in all he automotive and industrial segments, in India. In view of the foregoing, the proposed combination is not likely to give rise to any competition concern in India," the order, dated November 5, said.

Minda Industries is into manufacturing of LASB for two- wheelers while in India, Panasonic is engaged in sale and distribution of LASB for four-wheelers and UPS.
As a first step of the deal, Panasonic Corp through its subsidiaries -- Panasonic Holding (Netherlands) BV and Panasonic Asia Pacific Pte Ltd -- would fully acquire Minda Batteries Pvt Ltd.
Then, Panasonic Holding would subscribe to shares of Minda Batteries. Subsequently, Minda Industries would infuse funds into the joint venture in lieu of shares.
Further, Minda Industries would transfer its battery business -- that would include manufacturing facility for LASB located in Pantnagar, Uttarakhand -- to the joint venture company "by way of slump sale".